Anaheim Plans to Pursue Projects Despite Investment Losses
Ever since Orange County declared bankruptcy last month, officials here have tried to put a positive spin on the situation.
But so far, they have not explained fully how a city that wants to build new stadiums, develop a sports and entertainment complex, see Disneyland expanded and revitalize its downtown can afford to absorb a possible $45-million loss in the county’s investment pool.
Anaheim has $169 million invested in the county pool, which lost $2.02 billion in 1994 when risky investments made by former Treasurer-Tax Collector Robert L. Citron backfired. The city borrowed $95 million early last year specifically to invest in the fund, which had netted it nearly $12 million over the past three fiscal years.
Some clues to the city’s financial future were offered during a special workshop Tuesday, but a detailed plan--one that assumes that the millions of dollars of city money won’t be recovered--will not be completed until later this month, officials said.
City Manager James D. Ruth said the city’s saving grace is a healthy reserve fund that has grown steadily from $79.9 million in 1990 to $131.6 million in 1994--nearly 23% the size of the city’s current budget.
“We’ve built up our reserves over the last four years and we are very proud of that,” said Ruth, who has taken pains recently to stress that the city’s major development plans will move forward despite the county’s financial crisis.
Ruth said Tuesday that meetings have been scheduled this week with the Walt Disney Co., which has proposed a $3-billion resort next to Disneyland, and with the California Angels, who are close to hammering out an agreement with the city to build a new baseball stadium.
Negotiating a 30-year lease with the baseball team is now higher on the city’s priority list than trying to keep the Los Angeles Rams, who are expected to announce any day that the team is leaving the county, Ruth said. One aspect of the city’s discussions with the football team was renovating Anaheim Stadium or building the Rams a new football-only facility.
Also in the planning stages is a sports and entertainment complex surrounding the stadium.
The city will continue with its daily operations, capital improvement projects and major development plans by dipping into its reserve funds, Ruth said.
” “When you have a crisis, you dig into the reserves and you try to maintain your current levels of service,” he said. “It’s a one-time hit and then you move on.”
In response to the county’s financial crisis, which forced it to declare bankruptcy Dec. 6, Anaheim has instituted a hiring freeze, postponed all new capital improvement projects and canceled an order for a new city fleet.
“Our inclination is to not have to cut more,” Ruth said. “We’ll continue to scrutinize the budget and look at privatization possibilities.”